How is Gross Revenues defined for the purpose of calculating the Beehive Homes royalty fee?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
YOU are required to pay a royalty to US equal to five percent (5%) of Gross Revenues on each franchise owned. Gross Revenues is defined in the Franchise Agreement, Article IV, paragraph 4.3, as being all gross receipts received or receivable less sales or use tax. Each month YOU will furnish an accurate electronic report to US, according to OUR reporting instructions, containing this information. This data will be required from YOU by the 10th of the month following each monthly reporting period. (If YOU don't furnish the date in the required manner by the 10th of the month, YOU must pay a $100.00 penalty.) The royalty fee, as calculated from the date you report, is to be paid on or before the 10th day of each calendar month. Royalties are not refundable. A Royalty which is not paid when due will bear a late charge equal to ten percent (10%) of the past due balance. In addition to late charges, delinquent payments will be assessed interest at eighteen percent (18%) per annum or any lower maximum rate of interest allowable under the laws of the state in which YOUR Bee Hive Home is located from the due date until the date paid. WE have the right to examine YOUR books and records. If this examination reveals a discrepancy of two percent (2%) or more, then YOU will reimburse US for the cost of the examination.
Source: Item 6 — OTHER FEES (FDD pages 11–13)
What This Means (2025 FDD)
According to Beehive Homes's 2025 Franchise Disclosure Document, the royalty fee is 5% of Gross Revenues. Gross Revenues is defined as all gross receipts received or receivable less sales or use tax. This definition is further detailed in Article IV, paragraph 4.3 of the Franchise Agreement.
For a prospective Beehive Homes franchisee, this means that the royalty fee is calculated on nearly all income generated by the franchise, with a deduction only for sales or use taxes collected. It is important to understand what constitutes a 'gross receipt' in the context of a Beehive Homes franchise to accurately calculate and pay royalties.
Beehive Homes requires franchisees to furnish an accurate electronic report each month, according to their reporting instructions, containing the gross revenue information. This report is due by the 10th of the month following each monthly reporting period. Failure to submit the report in the required manner by the 10th results in a $100 penalty. The royalty fee, as calculated from the reported data, is also due on or before the 10th day of each calendar month. Franchisees should be diligent in their reporting and payment processes to avoid penalties and late charges, which can include a 10% late charge on the past due balance and interest at 18% per annum.